Explain why even owners of capital that cannot be moved can avoid more of the economic stability loss due to fixed exchange rates when Norway's economy is open to capital flows
What will be an ideal response?
The main reason is through diversification. If Norway's capital market is integrated with those of the EMU neighbors, Norwegians will invest some of their wealth in other countries while at the same time part of Norway's capital stock will be owned by foreigners.
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Identify the type of merger in each of the following situations and indicate how the post-merger concentration ratio for the industry is affected
a. A steel company merges with a coal and iron ore mining company.b. Staples, a retailer of office supplies, acquires Office Depot, another retailer of office supplies.c. An oil company merges with pipeline, shipping, and railroad companies as well as refineries and gas stations.
Free entry and exit of firms is a characteristic of:
A. perfectly competitive industries. B. all industries in the U. S. economy. C. centralized economies. D. industries in which firms are earning positive economic profit.